Strikes and Demonstrations Across the Periphery

As if we needed more proof that the course implemented by the eurocracy becomes increasingly untenable politically, millions decided to strike in several European countries this week. The demonstrations have, as they are wont to do these days, turned violent in a number places. The protests were most intense in Spain, where unemployment is at over 25% and desperation over the collapse of the bubble economy is growing by the day.

“Millions of Europeans joined together in general strikes and demonstrations on Wednesday to protest the strict austerity measures undertaken by their countries. In Portugal and Spain, hard hit by the debt crisis, locals conducted a 24-hour general strike that largely paralyzed public infrastructure, suspending train service and grounding hundreds of flights, in addition to shutting down factories.

Most of the protests remained peaceful, but in Madrid there were some violent clashes between demonstrators and police. Officers at Cibeles Square in the city center fired rubber bullets and used batons against protesters, reporting 34 injuries and the arrest of more than 70 protesters.

Officials warned the situation could escalate further on Wednesday night, with major protests planned for Madrid and Barcelona. A similar demonstration had also been planned for Portugal’s capital city, Lisbon.

The day of strikes had been called by organized labor across Europe as part of a “European Day of Action and Solidarity,” and similar events were staged in Italy, Greece, Belgium, Austria and France. The protesters believe that the austerity measures being taken in those countries to combat the debt crisis are worsening the recession. “We’re on strike to stop these suicidal policies,” said Candido Mendez, the head of Spain’s UGT union, the country’s second-biggest labor federation.”

(emphasis added)

This is what happens when after decades of socialism, the money to pay for the freebies finally runs out. To be sure, this is a bit too simplistic. We are inclined to sympathize with the demonstrators for the following reason: instead of liquidating unsound credit and letting a few over-extended banks and their bondholders bite the dust, the eurocrats have decided to spread the joys of bankruptcy around and let their populations pay the bill. In most cases the poorest members of society have been hit the hardest.

Most of the people thronging the streets don’t fully understand what has happened. They don’t realize that the deadly combination of a cradle-to-grave welfare state with a centrally planned fractionally reserved banking system has produced a terminal boom and that there is simply no painless way out of the situation anymore. There never was. An enormous amount of wealth has been squandered and consumed during the boom.

There is no salvation in abandoning the euro and trying to inflate and spend oneself out of the hole that has been dug either: that would only invite an even greater economic catastrophe. However, Europe’s political and monetary elites continue to misdiagnose the problem, in many cases refuse to level with their populations and are too halfhearted in implementing reform.

What the protesters don’t seem to get: the status quo ante cannot be recreated by decree. There is no magic wand for anyone to wave. The protesters have every right to be enraged, but they are raging against something that cannot be changed at the flick of a switch – the wealth is gone. If governments were to start on a renewed deficit spending spree, they would merely invite a greater crisis, very likely without delay. Even more government cannot be the solution for a problem that too much government has created.

Radical pro free market economic reform is called for, but this is apparently neither recognized, nor does anyone have the guts to implement it. And so the European Chinese water torture version of ‘austerity’, which includes only a shrinking private sector, but not a shrinking government, continues without offering any light at the end of the tunnel to the people living in the periphery.

Demonstrators and police battling in Madrid.

(Photo via: The Web, unknown source)

Maybe it is time to rename the Molotov cocktail. Throwing petrol bombs at the police has become a specialty of protesters in Greece.